By: Michael O’FarrellÂ
Investigations Editor
NEW Beginning sold the financial details of a struggling, debt-laden family to a controversial investment fund – even though the family had not formally engaged the mortgage advice group to assist them.
The intimate financial details – including mortgage arrears, after-tax income and children’s ages – were sold months after the family had lodged formal complaints relating to other matters about New Beginning with the Central Bank and the Insolvency Service of Ireland (ISI).
The Irish Mail on Sunday revealed that New Beginning had sold a database of 1,500 families to a €2bn investment fund that aims to buy up 15,000 distressed home loans at a discounted rate from the banks. Speaking to the MoS, father-of-two Billy Pirie explained: ‘It was just a kick in the teeth really that they’re kind of using us as a pawn.’ Their involvement with New Beginning dates back to November 2013 when Mr Pirie was threatened with repossession and he went to them for advice – but crucially never actually became a formal client. Mr Pirie and his fitness instructor partner Niamh have two children; a 17-year old son and a seven-year-old daughter. They paid €365,000 for their home in 2007 using a €305,000 mortgage from EBS.
In correspondence, seen by this newspaper, New Beginning told Mr Pirie that his only option was bankruptcy.
The New Beginning correspondence states that a fee of €2,500 was required plus a further €2,100 for Mr Pirie’s partner. These fees include statutory charges and other costs as well as New Beginning’s share.
However, Mr Pirie needed time to raise the fees to go bankrupt, and had to represent himself in February 2014 in a repossession hearing taken by EBS. That hearing was adjourned for six months, and during this period Mr Pirie sought different advice and ultimately never got New Beginning to deal with their case.
In fact, they were so unhappy with their experience at New Beginning that they formally complained to the Central Bank and the Insolvency Service in March and April of last year.
And because he never formally engaged New Beginning, Mr Pirie was astonished when Ross Maguire wrote to him in December to apologise for having included his details on the database sent to New Beginnings partner fund Arizun.
‘We went to them for help and they went ahead and sold our data to some company God knows where,’ Mr Pirie told the MoS.
‘They kind of saw us coming – that’s what it feels like. ‘We filled out a financial statement and told them everything and based on that they went for the bankruptcy option rather than look at what else was there,’ he said.
In November the MoS revealed that New Beginning had sold a database of 1,500 families to a €2bn investment fund that aims to buy up 15,000 distressed home loans at a discounted rate from the banks.
The Arizun fund then wants to rent the homes back to the previous owners. What would happen if residents were unable to afford the rent, and whether homes could be sold from underneath families, remains unclear.
New Beginning founder Ross Maguire – who reported the data breach to the Data Protection Commissioner only after being approached by the MoS in late November – apologised and said they had not intended to include personal details in the database sold to Arizun.
In return for the data and other services New Beginning was paid €20,000 and put on a €5,000 monthly retainer for three months. If the Arizun deal goes ahead, the group stands to earn millions.
An inquiry by the Data Protection Commissioner is under way. But last night New Beginning said it was unaware of any complaint to the Central Bank and ISI. ‘New Beginning is satisfied that our internal procedures are rigorously followed in all cases. In each case all avenues are explored,’ a spokesman said. The group also said that the threat of bankruptcy was an important tool to ‘focus lenders’ attention’ possibly leading to other solutions.
Meanwhile, Arizun said it was still pursuing its plan with banks and Government. ‘Our engagement with the relevant departments and institutions is ongoing and we look forward to a favourable outcome,’ a spokesman said.
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